ABSTRACT
China has a large positive balance of trade – both in monetary terms and in terms of the carbon embedded in trade (see Chapter 4). As the world moves towards policy measures and agreements that will place a price on carbon emissions, how will China’s exports be affected? This chapter addresses two aspects of that question, first looking specifically at the border tax adjustment proposals that have circulated in some developed countries, and then more generally at the likely impacts of carbon prices on China’s economy.
